A SMALL Manchester software firm is taking on the mighty Microsoft empire in a High Court battle over allegations that it has acted as a "rogue trader".

ITAC (UK), which has annual sales of around é14m, is countersuing the multi-billion pound software giant for libel after it filed a claim over allegations of copyright and trademark infringements involving goods imported from the Middle East. And its managing director Barry Omesuh has vowed not to be cowed by the powerful corporation.

"I think they thought my client would just roll over. But he does not like being bullied, and will stand his ground," said Pannone & Partners lawyer Bill Lister, a commercial litigation expert.

"He specialises in contentious intellectual property, sports and media law, who expects the proceedings to become a landmark case which could bring changes in the law.

Mr Lister said the libel action had been launched, after "groundless" accusations appeared on the Microsoft Corporation website and were circulated via a "media alert" and e-mails claiming that ITAC acted with rogue distributors in Dubai to import Microsoft software into this country and that consequently the company intended to sue for $7m in damages.

Claim

He said: "However, despite the fact that Microsoft presented these allegations to the media as if they were proven, not one piece of evidence has been produced in support of their claim," said Mr Lister, who said they went way beyond what was due to be contested in court.

"It is quite clear from Microsoft's publicity machine that they are seeking to litigate the disputed issues in the public arena rather than in a court of law which is the proper forum for such a dispute," he said.

Libel proceedings are being served on Microsoft at its headquarters in Seattle and in the United Kingdom as well as against specific individuals .

ITAC, based in Prestwich, was launched in 1997, and now employs a staff of 15.

The dispute centres on whether or not there was consent for it to import Microsoft goods from the Middle East for distribution in Europe.

Mr Lister said the court action had come out of the blue, and Microsoft had not raised any issues with the company before taking that action.

Microsoft has been cracking down on cases of unlicensed or counterfeit software, but a spokeswoman said the company would not comment on this case whilst legal action was ongoing.